Correlation Between PT Bank and Corenergy Infras

Can any of the company-specific risk be diversified away by investing in both PT Bank and Corenergy Infras at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining PT Bank and Corenergy Infras into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PT Bank Rakyat and Corenergy Infras, you can compare the effects of market volatilities on PT Bank and Corenergy Infras and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in PT Bank with a short position of Corenergy Infras. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Corenergy Infras.

Diversification Opportunities for PT Bank and Corenergy Infras

0.0

Correlation Coefficient

PT Bank  Corenergy Infras

Pay attention - limited upside

The 3 months correlation between BKRKF and Corenergy is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Rakyat and Corenergy Infras in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corenergy Infras and PT Bank is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on PT Bank Rakyat are associated (or correlated) with Corenergy Infras. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corenergy Infras has no effect on the direction of PT Bank i.e., PT Bank and Corenergy Infras go up and down completely randomly.

Pair Corralation between PT Bank and Corenergy Infras

If you would invest  24.00  in PT Bank Rakyat on October 25, 2024 and sell it today you would earn a total of  1.00  from holding PT Bank Rakyat or generate 4.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.56%
Values	Daily Returns

PT Bank Rakyat  vs.  Corenergy Infras

PT Bank Rakyat

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PT Bank Rakyat has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward-looking signals, PT Bank is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Corenergy Infras

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Corenergy Infras has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Corenergy Infras is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with PT Bank and Corenergy Infras

The main advantage of trading using opposite PT Bank and Corenergy Infras positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Corenergy Infras can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Corenergy Infras will offset losses from the drop in Corenergy Infras' long position.

The idea behind PT Bank Rakyat and Corenergy Infras pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.